The five second-grade boys believed they were passing around small packets of powdered candy yesterday morning during gym class at Delaplaine McDaniel Elementary School in South Philadelphia.

The boys' mischief caught the eye of their gym teacher, and police later confirmed the bags contained heroin.

"Our belief at this time is that they [the boys] thought it was candy," police spokesman Sgt. Ray Evers said of the 10:30 a.m. incident.

One of the boys - before the bags were taken away by school authorities - also quickly realized it was not a sweet treat. The boy put a small amount of the drug in his mouth and quickly spit it out, said Fernando Gallard, a spokesman for the Philadelphia School District. The four other boys told school administrators and police they only touched the drug. None said they ingested it, and the school nurse soon confirmed that the boys showed no signs of illness.

Still, the boy who tasted the heroin was taken by ambulance to Children's Hospital of Philadelphia for observation. Three of the boys were taken in police squad cars to the hospital, where they were met by their parents, and one was driven there by his father, Gallard said.

All five were still at Children's early last night.

Authorities did not release the name of the gym teacher.

Philadelphia Police Lt. Frank Vanore said police investigators are trying to determine how and where the child who brought the heroin to school obtained it.

The Department of Human Services is also investigating to make sure the children are safe in their homes.

"Obviously, these kids were not the source of the heroin. . . . They obtained it from somewhere, and our detectives are trying to find what that source is," Vanore said. He said no charges have been filed.

The children's parents were with them at the hospital, Vanore said.

Alicia Taylor, a spokeswoman for DHS, said only that "we're investigating it." She said the department's goal is "to ensure that all the children are safe."

School administrators handed out a letter from Principal Darlynn Gray to parents picking up their children from school yesterday afternoon. The letter stated that a second-grade student brought an "unidentifiable suspicious substance" to school, distributed it to "several other students" and that Gray has an "open door policy" for parents and students.

McDaniel, located at 1901 South 23d St., educates 592 students in kindergarten through fifth grade. Gallard said extra counseling staff will be at McDaniel today in case students, parents or staff are upset and need to speak with someone. As of the close of the school day yesterday, administrators had no plans to address the student body as a whole or have teachers discuss the incident in class.

"The expectation is that parents will speak with their children about it" after reading the letter, Gallard said.

This is the first incident involving a controlled substance at McDaniel this year, Gallard said.